In just three years’ time, the Belgian start-up MyMicroInvest has become the largest crowdfunding platform in Belgium. The organisation is now ready to take the leap and expand internationally into Europe.
What is Crowdfunding?
Crowdfunding is a form of alternative finance, whereby a project or venture is funded with small amounts of money, of 100 euros or more, from (a large group of) private individuals. Sometimes start-ups or young entrepreneurs find it difficult to obtain funding through the traditional channels. Crowdfunding allows them to raise the funding they need for their growth plans.
There are two types of Crowdfunding. Under the non-financial or donation model, the public lends its support to creative, artistic or charity projects without expecting a financial return. Well-known platforms include Kickstarter and KissKissBankBank. Financial crowdfunding allows the public to collectively invest in start-ups or small enterprises. In this model, we distinguish between Equity Crowdfunding (invest in exchange for shares) and Loan Crowdfunding (lend in exchange for fixed returns, i.e. interest).
While crowdfunding as a way of publicly raising funds has been in existence for quite some time, the modern Crowdfunding boom started in 2008, as a result of a combination of a number of factors. On the one hand, there was the development of the Internet with its improved functionality and the emergence of social media. On the other hand, the financial crisis prompted investors to look at alternatives.
Crowdfunding in Belgium
Crowdfunding as such is a very recent phenomenon but it is growing at a very fast pace. It is estimated that in 2015 alone 16 billion euros were raised through Crowdfunding. The Belgian market is estimated to be worth 5 to 6 million, of which 40% was raised through MyMicroInvest.
To the best of our knowledge, the Belgium Top 3 by:
– Budget raised
– Number of members
– Number of projects
MyMicroInvest develops a funding model for selected projects, which consists of a combination of professional investments on the one hand and crowdfunding on the other. Consequently, it can offer private individuals a unique opportunity to invest in risk capital, along with professional investors and business angels, enjoying the same conditions and allowing them to diversify their investment portfolio.
MyMicroInvest has more than 31,000 members. Since its inception in July 2011, the platform has already raised over 15 million euros for 42 different projects.
In November 2013, MyMicroInvest raised a capital of 1.3 million euros for Newsmonkey, the new, young and somewhat rebellious (Dutch-language) news website. It was the largest equity crowdfunding transaction in Europe at the time, with no fewer than 1,487 private investors subscribing (along with professional investors).
2. Domobios: Acar’Up
In June 2015, the Brussels company Acar’Up SPRL raised 100,000 euros in just 18 minutes’ time for “Acar’up”, their natural product to combat dust mites. The crowdfunding campaign also offered them a unique opportunity for community marketing. The users of their product also became brand ambassadors.
A top-notch medical project involving the Life Observer Mobile of the Walloon company 2-Observe. Their concept monitors the respiratory movements of patients in hospitals and nursing homes and informs nursing staff in case of problems. Fifty crowd investors raised 155,000 euros, together with a few business angels, so the concept could be further developed.
4. The Green Link
The Green Link is a Paris-based parcel-delivery service, which offers company an energy-friendly solution for the “last mile” in their delivery chain. The Green Link also wants to play a social role, caring for the elderly who are unable to leave their homes. MyMicroInvest raised an investment of 99,500 euros through Crowdfunding (5-year loan).
MyMicroInvest is a very fast-growing player in a fast-growing market. The platform currently employs 24 people. The MyMicroInvest platform has been adapted on the legal and technical level to fulfil the European legal conditions in force, so investment projects can be launched outside of Belgium at an affordable cost.
The combination of both these factors enable MyMicroInvest to develop activities in five new European countries, namely Poland, Switzerland, Italy, France and the Netherlands (check the prospectus for the financial perspectives).
To date, MyMicroInvest has already raised a capital of 3 million euros for its European expansion. This budget will be supplemented with Crowdfunding – MyMicroInvest’s DNA.
MyMicroInvest has chosen a specific type of Crowdfunding for its own campaign, namely “live” Crowdfunding. The funding is raised by interested investors, within a limited time frame, during an event, which is filmed and broadcast live through the Internet. This allows the attendees and Internet users to follow the event, participate in the Q&A and invest “live” in the proposed project. Live Crowdfunding creates a new way of investing, which gathers entrepreneur(s) and investors during a unique and hyper-interactive event. MyMicroInvest hopes to raise a record amount of 1 million euros during the Live Crowdfunding event on 20 January 2016.